The much-awaited Life Insurance Corporation of India (LIC) IPO (initial public offering) is set to open next week with the public sector behemoth filing its Red Herring Prospectus (RHP) with capital market regulator SEBI on Tuesday evening. However, much has changed since LIC filed its draft papers earlier in February. Now, the insurance giant is looking to sell 221 million equity shares, down from 316 million it had planned earlier. The issue size has been trimmed down to 3.5% of equity, from 5% planned earlier. But LIC’s public issue will still be the largest ever to hit Dalal Street. LIC IPO will open on May 4.
Price band and issue size
The government of India will sell shares of LIC at a fixed price band of Rs 902-949 per equity share of Rs 10 each face value. At the higher end of the price band, the LIC IPO will help the government raise just over Rs 21,000 crore. Earlier in February, the government had planned on raising around Rs 60,000 crore from the public issue, selling just over 5% stake. Now the size of the sale has been brought down to 3.5%.
Valuations have also come down for LIC. Now the company is valued at just over Rs 6 lakh crore. The RHP mentions the embedded value of LIC to have been calculated at Rs 5.39 lakh crore as of September 31, 2022.
This article was originally posted here.
